Global Economic Recovery is Slipping Away, Say Accountants

LONDON, February 2, 2011 - The global economic recovery, which has been slowing down in the past few
months, has now gone into reverse, according to a worldwide survey of finance
professionals by ACCA (the Association of Chartered Certified Accountants).

The results of ACCA's Global Economic Conditions survey for the fourth
quarter of 2010, show that twice the number of accountants as compared with
the previous quarter (28% as opposed to 14%) believe that the recovery is
slipping away.

Faith in the recovery is also at its lowest level in 18 months, with less
than a third of respondents (32%) believing that conditions are improving -
or are about to. In the previous quarter nearly a half (47%) were optimistic
about economic prospects.

As a result, business confidence, as recorded by the survey of more than
600 professional accountants from around the world, has now gone into
negative territory for the first time since the third quarter of 2009, with
the share of respondents reporting no change in their confidence levels (37%,
down from 42% in Q3, 2010) falling below that of respondents who had lost
confidence in their organisations (38%, up from 28%).

Manos Schizas, Senior Policy Adviser with ACCA, said: "The issue for
finance professionals for some time now has been the question of whether the
economy, which had been showing signs of recovery, had taken a pause for
breath or was about to take a downturn. The findings of this survey suggest
that finance professionals think the downturn is now the more likely
scenario."

While the SME sector appears to be the most resilient, followed by the
private, non-financial sector, there has been a significant drop in
confidence in accountants working in large financial services companies.

This may be as a response to developments such as the economic crises in
some European countries. Finally, as had been feared, confidence levels among
public sector accountants are lower than were seen during the depths of the
downturn and the loss of confidence in this sector continues to accelerate.

The survey has also shown that accountants see governments as being
powerless to prevent a new downturn. As a result, assessments of government
policy have decoupled from economic conditions and remained relatively
positive. While 38% of respondents (up from 33%) rated their governments'
responses to current economic conditions as 'poor' or 'very poor', a
relatively stable 26% (down from 27%) rated them as 'good' or 'very good'.

The survey shows that late payment is on the increase, as is the number
of insolvencies. The outlook for investment has also deteriorated, with
businesses putting off decisions until the economic outlook becomes clearer.
Only 8% of respondents reported a rise in investment of any kind (down from
14%), but the share of respondents reporting a scaling down of investment in
staff and capital also fell marginally (from 38% to 37%).

Notes to Editors

1) ACCA (the Association of Chartered Certified
Accountants) is the global body for professional accountants. We aim
to offer business-relevant, first-choice qualifications to people of
application, ability and ambition around the world who seek a
rewarding career in accountancy, finance and management.

2) We support our 140,000 members and 404,000 students in 170
countries, helping them to develop successful careers in accounting
and business, with the skills required by employers. We work through
a network of over 80 offices and centres and more than 8,000 Approved
Employers worldwide, who provide high standards of employee learning
and development. Through our public interest remit, we promote
appropriate regulation of accounting and conduct relevant research to
ensure accountancy continues to grow in reputation and influence.

3) Founded in 1904, ACCA has consistently held unique core
values: opportunity, diversity, innovation, integrity and
accountability. We believe that accountants bring value to economies
in all stages of development and seek to develop capacity in the
profession and encourage the adoption of global standards. Our values
are aligned to the needs of employers in all sectors and we ensure
that through our qualifications, we prepare accountants for business.
We seek to open up the profession to people of all backgrounds and
remove artificial barriers, innovating our qualifications and
delivery to meet the diverse needs of trainee professionals and their
employers.

    For further information, please contact:

    Laura Strong, ACCA Newsroom
    +44(0)20-7462-8921
    lstrong@ruderfinn.co.uk

For further information, please contact: Laura Strong, ACCA Newsroom, +44(0)20-7462-8921, lstrong at ruderfinn.co.uk